Lynas gets Malaysian rare earths plant going

After months of polemic and legal battles, Australian rare earths miner, Lynas (ASX:LYC), has finally begun production at its Malaysian processing plant following a recent court triumph.

The company said Friday that the first rare-earth concentrate had been fed into the kiln at its Lynas Advance Material Plant (LAMP) in Kuantan.

"This is a significant milestone," executive chairman Nicholas Curtis said in a statement. "The operation of the LAMP is now a reality, and the LAMP will provide real data that will assure people that the LAMP is entirely safe for our local communities and the environment."

But investors didn’t seem to welcome the news, as Lynas shares sunk 5.19% on Friday’s trade in Sydney to 64 cents, against a benchmark index rise of 0.63%.

LAMP's start was long-delayed because of ongoing strong opposition from locals based on potential health and environmental threats.

Critics of the project believe that allowing the $230 million refinery will jeopardize Malaysia’s well being and pollute the surroundings. Supporters argue that the plant can help stabilize rare earth prices, as it is the first in years outside China. The country, which currently supplies about 95% of the world's rare earths, has restrictions on those exports.

In September a Malaysian court dismissed an application by the Save Malaysia Stop Lynas group to block Lynas's operating licence, but legal challenges are ongoing.

Hon Kai Ping, a lawyer representing the activists, said a higher court had fixed February 5 to hear an application to revoke the Australian miner's licence.

Cecilia Jamasmie, news editor at MINING.com, has over 15 years of experience in print media, TV, online media and public relations. She specializes in Corporate Social Responsibility (CSR) and the Latin American market. Cecilia has been interviewed by BBC News and CBC among others. She has also been syndicated by Forbes, Seeking Alpha and BIV. She holds a Master of Journalism (MJ) from the University of British Columbia, Canada, and she is currently based in Halifax, Nova Scotia.